Year-End Payroll Checklist for Accountants: W-2s, 941 and 940 (2027)

Year-end payroll is where a year of small payroll errors comes due. Names that don’t match Social Security records, fringe benefits that never hit a paycheck, quarterly 941s that don’t tie to the W-2s: all of it has to be fixed before W-2s go out. This checklist gives your firm one repeatable process for closing payroll on every client.

Below are the 2027 deadlines, the seven-step year-end payroll workflow, and a free template you can run for all of your payroll clients in Jetpack Workflow.

Key year-end payroll dates for tax year 2026

January 31, 2027 falls on a Sunday, so the January deadlines move to Monday, February 1, 2027.

State annual reconciliations and unemployment filings have their own dates. Add them to each client’s workflow when you set it up.

The year-end payroll checklist (step by step)

1. Process the final payroll of the year, including bonuses and fringe benefits. Confirm year-end bonuses, taxable fringe benefits (such as personal use of a company vehicle or S-corp shareholder health insurance) and any manual checks are in the last payroll, so they land on the W-2.
2. Verify employee names, addresses and SSNs. Mismatched names and SSNs are the most common cause of W-2 rejections and corrections. Check them against W-4s before anything is filed.
3. Reconcile annual payroll to the quarterly 941s and the general ledger. Total wages and withholding on the four 941s should match the W-2 totals and the books. Fix differences now, before they turn into W-2c forms and notices.
4. Review draft W-2s. Spot-check boxes for retirement contributions, health insurance and other benefits, and confirm state and local wages are reported in the right boxes.
5. File W-2s and W-3 and distribute to employees. E-file with the SSA and deliver copies to employees by the deadline. Note any employees who need a mailed copy.
6. File Form 940, the Q4 941 and state annual reconciliations. Close the federal and state filings for the year and confirm deposits were made on time.
7. Send year-end reports to the client and save filings. Deliver the annual payroll summary and save every filing and confirmation to the client file for next year’s reconciliation.

Common year-end payroll mistakes

• Missing fringe benefits. Benefits added after the final payroll mean a W-2c. Step 1 confirms them before the last run.
• Name and SSN mismatches. Step 2 catches them before the SSA does.
• 941s that don’t tie to W-2s. Step 3 reconciles both to the general ledger, so totals match on the first filing.
• Forgotten state filings. Step 6 keeps state reconciliations on the same checklist as the federal forms.

How to close payroll for every client at once

Year-end payroll is the same seven steps for every client, but each client moves at a different speed. In Jetpack Workflow, you apply the year-end payroll template to every payroll client, assign each step to the right person and see at a glance which clients are still waiting on bonus amounts or employee updates. It pairs with the recurring Payroll Processing and Quarterly Payroll Filings Reconciliation templates, so year-end starts from clean quarters.

FAQ

When are W-2s due in 2027?

W-2s for tax year 2026 are due to employees and the SSA by Monday, February 1, 2027, because January 31 falls on a Sunday.

What should be reconciled before filing W-2s?

Reconcile total wages and withholding on the four quarterly 941s to the W-2 totals and to the general ledger. Differences should be fixed before filing.

When should year-end payroll work start?

Start in early December. Confirm bonuses, fringe benefits and employee details before the final payroll runs.